Market News June 6 Financial Breakfast: Saudi Arabia raised the price of crude oil in Asia, US oil jumped above the 120 mark, non-agricultural beauty was beautiful, and the gold price retreated to the 1850 mark
June 6 Financial Breakfast: Saudi Arabia raised the price of crude oil in Asia, US oil jumped above the 120 mark, non-agricultural beauty was beautiful, and the gold price retreated to the 1850 mark
U.S. crude oil opened slightly higher, hitting a record high of $120.95 a barrel since March 10, as Saudi Arabia raised its July oil sales price to Asian customers over the weekend, and the increase exceeded expectations; in addition, OPEC decided to raise its output target slightly more than planned Increase, the market is not expected to increase the global supply too much. Spot gold is temporarily hovering around the 1850 mark. The US May non-farm payrolls report released last week was better than expected, providing support to the dollar, putting pressure on gold prices and increasing the uncertainty of short-term trends.

2022-06-06
9997
In early Asian trading on Monday (June 6), U.S. crude oil opened slightly higher, hitting a new high of $120.95 per barrel since March 10, as Saudi Arabia raised the price of oil sales to Asian customers in July over the weekend, and the increase was more than expected; in addition, OPEC decided to raise its output target slightly more than planned, and the market is not expected to increase global supply too much. Spot gold is temporarily hovering around the 1850 mark. The US May non-farm payrolls report released last week was better than expected, providing support to the dollar, putting pressure on gold prices significantly, and the uncertainty of short-term trends has increased significantly.
In terms of commodity closings, on Friday (June 3), the COMEX August gold futures closed down 1.1%, the largest one-day drop in the past three weeks, at $1,850.20 per ounce. WTI July crude oil futures closed up $2.00, or 1.71%, at $118.87 per barrel; Brent August crude oil futures closed up $2.11, or 1.79%, at $119.72 per barrel.
US stocks closed: The S&P 500 fell 1.6% on Friday, the Nasdaq Composite fell 2.5%, the Nasdaq 100 fell 2.7%, and the Dow Jones Industrial Average fell 1.0%.
There is no important economic data released this trading day, pay attention to China's May Caixin service industry PMI, in addition, South Korea's Seoul Stock Exchange is closed for Xianzhong Day.
Saudi raises July oil sales prices to Asian customers more than expected
On June 5, Saudi Arabia raised oil prices for Asian customers more than expected as demand rose from major Asian economies. Saudi Aramco raised the price of Arabian Light crude for Asian customers by $2.10 to a premium of $6.50. Refiners and traders expected a gain of $1.50. In some places, "the rebound in demand has been pretty amazing," said Mike Mueller, head of Asia at Vitol Energy Group. "The demand for road transport in many Southeast Asian countries has greatly exceeded expectations. Trying to get a ticket in Singapore during the summer is very tough," he said.
Russia attacked Kiev for the first time in weeks as Ukraine said it had regained half of North Donetsk.
Russia struck the Ukrainian capital Kiev with missiles earlier on Sunday (June 7) for the first time in more than a month. Ukrainian officials say a counteroffensive on the main battlefield in the east has recaptured half of the territory of the city of Severo Donetsk. Sunday's attack was the first large-scale attack on Kyiv since the end of April. In recent weeks, Russia's attacks have been concentrated on the eastern and southern fronts, but have occasionally attacked elsewhere, claiming to weaken Ukraine's military infrastructure and prevent Western arms shipments.
Putin warns the West: Russia will strike harder if it provides long-range missiles ① Russian Tass news agency reported that President Putin warned the West that if the United States began to provide long-range missiles to Ukraine, Russia would strike new targets. If such missiles are provided, "we will hit those targets that we have not yet hit," Putin said in an interview with the Rossiya-1 state television channel.
②Putin denied that Moscow blocked the export of grain from Ukrainian ports, and said that as long as the sanctions on Belarus are lifted, the best solution is to export grain through Belarus.
Russia said that the West does not allow Ukraine to negotiate with Russia. On the 4th local time, Russian Foreign Minister Sergei Lavrov said in an interview with Serbian Radio and Television that the current lack of progress in Russia-Ukraine negotiations is because the West does not allow Ukraine to negotiate with Russia. When talking about economic sanctions against Russia, Lavrov said that despite the EU's restrictions on seaborne oil, Russia will significantly expand oil exports to markets outside the EU. Given the high oil prices, the Russian budget will not suffer losses. Russia's energy exports in 2022 Profits increased significantly. (Global Times)
U.S. jobs added more than expected in May, strong labor market keeps Fed on aggressive path
① The US added non-farm jobs in May more than expected, and wage growth remained at a fairly strong level, indicating a strong job market, which will prompt the US Federal Reserve (FED/Fed) to continue to adopt aggressive monetary tightening policies to cool down need. The data also showed the unemployment rate held steady at 3.6% for the third straight month, despite more people entering the labor force. That paints a picture of continued economic expansion, albeit at a slower pace.
② U.S. President Biden said the May jobs report was “very good” and he expected the pace of hiring to slow further in the coming months.
The U.S. ISM services index fell in May, and business activity growth slowed ①Due to the slowdown in business activities, the U.S. service industry growth slowed to the lowest level in more than a year in May.
②According to data released last Friday, the Institute for Supply Management (ISM) services index fell to 55.9 from 57.1 in April. Although it remains firmly above the 50 watershed of prosperity and decline, it is already the weakest since February 2021.
A measure of business activity fell 4.6 to a two-year low of 54.5 last month. However, another measure of demand, the new orders index, climbed to 57.6 in May.
④ The median forecast in a Bloomberg survey was 56.5. Fourteen service industries posted gains last month, led by mining, construction and real estate.
⑤ Consumers have so far continued to hold on to spending in the face of soaring oil prices, but high inflation (including record gasoline prices) coupled with rising borrowing costs may limit discretionary spending in the coming months.
⑥ The ISM survey showed that the price paid index for the service industry fell to 82.1, and the employment index rose slightly. But even then, it was only slightly over 50.
Fed Mester says may need to raise interest rates by 50 basis points in September as well "Evidence that inflation has peaked, according to a slew of data. Mester and other Fed policymakers, including Chairman Jerome Powell, have signaled that they will continue to raise rates by the same amount at their June and July meetings after raising rates by 50 basis points last month. "If I don't see convincing evidence at the September meeting, I'll probably vote for a 50 basis point hike," Mester said.
Bank of America expects the European Central Bank to raise interest rates by 50 basis points at least twice in 2022 ① Bank of America expects that the European Central Bank will raise interest rates by 50 basis points in July and September, and by 25 basis points in October and December.
② This forecast is far more hawkish than the current consensus of economists, implying that the deposit rate will increase by 150 basis points this year. Economists Ruben Segura-Cayuela and Evelyn Herrmann said in a note that they were more certain about the overall rate hike.
③ "We strongly believe in a 150 basis point rate hike in 2022," they wrote. "But we're less certain about the exact timing of a 50 basis point hike."
④ The two economists also predicted that the ECB's interest rate hikes will stop in 2023. Bank of America had previously forecast four 25 basis point rate hikes this year and two next year.
⑤ They mentioned in their latest report that they are concerned that the ECB is “doing too much/too fast, creating problems in terms of growth or spreads, or both.” Although their forecasts are hawkish, they Indicates "bearish on the macro outlook".
⑥ European Central Bank officials will meet next week and are expected to reveal plans to reduce stimulus measures, immediately end large-scale asset purchases, and raise interest rates for the first time next month.
Survey: The European Central Bank is expected to raise interest rates slightly from July, and the expectation of a 50 basis point increase may fail Efforts to cut interest rates by 50 basis points are likely to fail.
②The survey results show that the ECB is expected to raise the deposit rate (currently -0.5%) by 25 basis points in July and September respectively. While this is in line with ECB President Christine Lagarde's pledge to end negative interest rates in the third quarter, the rate hike will be less than expected by officials such as Austrian Central Bank President Robert Holzmann.
③ Calls for stronger action have grown as the ECB pulls back from stimulus, as euro zone inflation hit another record high of 8.1 percent in May, more than four times the ECB’s target.
④ However, Lagarde is expected to use the June 9 news conference to confirm the more cautious exit strategy she laid out last week, which is to end large-scale quantitative easing before raising interest rates in July.
⑤ "The ECB is expected to pre-commit to raising deposit rates in July, reiterating its intention to end quantitative easing by the end of the second quarter as planned," said Claus Vistesen, chief euro zone economist at Pantheon Macroeconomics. "The question is whether this will be a 25 basis point hike or 50 basis points. We think it's the former, but the pressure to act more decisively is rising."
5 police officers injured in bomb attack in Kenya's Garissa
On June 5, an improvised bomb attack occurred in Garissa County, Kenya, injuring five police officers. On the same day, an improvised bomb device placed on the side of the road suddenly exploded while a convoy led by a police car was driving, causing serious damage to the vehicle. The injured have been sent to the hospital for treatment. Local police said the bomb may have been detonated by Somali al-Shabaab militants. (CCTV News)
The latest poll: Only 37% of Americans approve of Biden's handling of current economic problems The results show that only 37% of people approve of US President Biden's handling of the current economic problems in the United States, only 28% of people approve of his handling of inflation, and 27% of people support Biden's handling of rising gasoline prices. More than 80 percent of Americans say economic concerns, inflation and rising natural gas prices are the most important issues in determining how they vote this November, polls show. And with the midterm elections approaching, public support for Biden's handling of these key issues is low. (CCTV News)
U.S. stocks fell sharply on Friday after better-than-expected jobs data for May suggested the labor market remained strong enough for the Federal Reserve to keep raising interest rates to curb inflation. U.S. stocks returned to a weekly decline as strong jobs data paved the way for aggressive interest rate hikes by the Federal Reserve to fight inflation, with the S&P 500 down 1.6 percent, closing lower in eight of the past nine weeks. Tesla also dragged tech stocks lower on Friday on reports that the company plans to cut salaried workers. Energy stocks rose as crude oil hit $120 a barrel in New York.
The Fed is expected to raise interest rates by 50 basis points each at the next two meetings, and after the release of the jobs report, the market implied probability of a third rate hike in September remained around 85%.
Peter Essele, head of portfolio management at Commonwealth Financial Network, said the second half of 2022 will be a roller coaster for investors unless the Fed can control inflation and not cause a hard landing, and most investors seem to be betting on a hard landing scenario, a recession. Fears pervaded and stocks failed to build any positive momentum.
Investors remained focused on economic data and its impact on the pace of U.S. monetary tightening amid growing concerns that restrictive Fed policy could tip the world's largest economy into recession. The strong jobs report quelled some concerns while also clearing the way for the Fed to remain aggressive.
Spot gold fell by more than 1% at one point, hitting a daily low of $1,847.26 an ounce, affected by a stronger dollar and better-than-expected U.S. jobs data sparking concerns about aggressive monetary tightening.
On Friday (June 3), the U.S. dollar rose 0.41%, and the 10-year U.S. Treasury yield was close to a two-week high hit earlier in the session, which put pressure on gold prices; gold prices fell 0.12% last week, although slightly It had touched $1,873.99 an ounce, the highest since May 9.
Data showed that the U.S. added more nonfarm payrolls than expected in May, and wage growth remained at a fairly robust level, indicating a strong labor market.
David Meger, head of metals trading at High Ridge Futures, said the Fed may feel more emboldened to speed up the pace of rate hikes if they think the economy remains stable during its rate hikes.
Cleveland Fed President Mester said on Friday that she is looking for "compelling" evidence that inflation has peaked, and if not, she is likely to support a 50 basis point hike at the September meeting.
U.S. oil rose nearly 3% in late trading last Friday, standing at the $120 mark, a new high since March 9. The market expects the Organization of the Petroleum Exporting Countries (OPEC) to decide to slightly increase the output target from the plan, which will not increase global supply too much. . And global supply should tighten after some regions ease the epidemic.
OPEC and its allies including Russia, OPEC+, agreed to increase output by about 650,000 bpd a month over the next two months, instead of the current 432,000 bpd.
U.S. crude rose for a sixth straight week, helped by tight U.S. supplies, which has sparked discussions of capping fuel exports or imposing windfall taxes on oil and gas producers.
Jim Ritterbusch, president of Ritterbusch and Associates LLC, said the OPEC+ decision and the accelerated release of the Strategic Petroleum Reserve have kept crude supplies at adequate levels, especially as demand from refiners is significantly lower than it was a few years ago.
U.S. President Joe Biden has publicly acknowledged that he may soon travel to Saudi Arabia, which multiple sources said was to be expected, and that Biden could hold talks with leaders including Saudi Crown Prince Mohammed.
Supply remains tight. On Thursday, the weekly U.S. inventories report showed crude inventories plummeted by 5.1 million barrels, a sharper-than-expected drop. Gasoline inventories also fell.
The U.S. oil and gas rig count remained unchanged at 727 for the week ended June 3, according to a closely watched report from Baker Hughes on Friday.
The U.S. dollar index rose 0.41% to 102.18 on Friday, after gaining about 0.5% last week after a better-than-expected U.S. jobs report that showed a tighter labor market may keep the U.S. Federal Reserve aggressively raising interest rates.
Minh Trang, senior foreign exchange trader at Silicon Valley Bank, said the non-farm payrolls data was quite solid, and the strong employment data supported expectations for further rate hikes in the second half of the year.
The Fed has already raised interest rates by 0.75 percentage points this year, and most Fed policymakers support another 0.5 percentage point hike at each of the next two meetings.
Cleveland Fed President Mester said on Friday she would be looking for "compelling" evidence that inflation has peaked before supporting a slower pace of interest rate hikes. Policymakers said the Fed could raise rates by 50 basis points each in June and July.
Investors were divided on the dollar, which remained near 20-year highs against a basket of currencies. George Saravelos, global head of foreign exchange research at Deutsche Bank, said the dollar is "priced at a very extreme risk-off premium that rarely lasts and investors are unwinding that position right now."
Optimistic analysts believe the Fed's tightening cycle is based on stronger U.S. economic growth than Europe's, especially after an embargo on Russian oil that could hurt the euro zone economy.
The dollar rose as much as 0.87% against the yen to a more than three-week high of 130.97, not far from a 20-year low hit in May, as the Bank of Japan stuck to its ultra-low interest rate policy stance. Bank of Japan Governor Haruhiko Kuroda said on Friday that he was unhappy with prices rising too fast amid weak household income growth. He has said the bank will not withdraw its massive monetary stimulus because the recent rise in inflation, driven mainly by rising raw material costs, may be temporary.
"Everyone, including the ECB, is talking about things like raising rates, but when it comes to the Bank of Japan, we don't see that discussion, and I think that's why you see the yen," said Silicon Valley Bank's Trang. Exaggerated downtrend.
In terms of commodity closings, on Friday (June 3), the COMEX August gold futures closed down 1.1%, the largest one-day drop in the past three weeks, at $1,850.20 per ounce. WTI July crude oil futures closed up $2.00, or 1.71%, at $118.87 per barrel; Brent August crude oil futures closed up $2.11, or 1.79%, at $119.72 per barrel.
US stocks closed: The S&P 500 fell 1.6% on Friday, the Nasdaq Composite fell 2.5%, the Nasdaq 100 fell 2.7%, and the Dow Jones Industrial Average fell 1.0%.
Looking Ahead Monday
There is no important economic data released this trading day, pay attention to China's May Caixin service industry PMI, in addition, South Korea's Seoul Stock Exchange is closed for Xianzhong Day.
international news
Saudi raises July oil sales prices to Asian customers more than expected
On June 5, Saudi Arabia raised oil prices for Asian customers more than expected as demand rose from major Asian economies. Saudi Aramco raised the price of Arabian Light crude for Asian customers by $2.10 to a premium of $6.50. Refiners and traders expected a gain of $1.50. In some places, "the rebound in demand has been pretty amazing," said Mike Mueller, head of Asia at Vitol Energy Group. "The demand for road transport in many Southeast Asian countries has greatly exceeded expectations. Trying to get a ticket in Singapore during the summer is very tough," he said.
Russia attacked Kiev for the first time in weeks as Ukraine said it had regained half of North Donetsk.
Russia struck the Ukrainian capital Kiev with missiles earlier on Sunday (June 7) for the first time in more than a month. Ukrainian officials say a counteroffensive on the main battlefield in the east has recaptured half of the territory of the city of Severo Donetsk. Sunday's attack was the first large-scale attack on Kyiv since the end of April. In recent weeks, Russia's attacks have been concentrated on the eastern and southern fronts, but have occasionally attacked elsewhere, claiming to weaken Ukraine's military infrastructure and prevent Western arms shipments.
Putin warns the West: Russia will strike harder if it provides long-range missiles ① Russian Tass news agency reported that President Putin warned the West that if the United States began to provide long-range missiles to Ukraine, Russia would strike new targets. If such missiles are provided, "we will hit those targets that we have not yet hit," Putin said in an interview with the Rossiya-1 state television channel.
②Putin denied that Moscow blocked the export of grain from Ukrainian ports, and said that as long as the sanctions on Belarus are lifted, the best solution is to export grain through Belarus.
Russia said that the West does not allow Ukraine to negotiate with Russia. On the 4th local time, Russian Foreign Minister Sergei Lavrov said in an interview with Serbian Radio and Television that the current lack of progress in Russia-Ukraine negotiations is because the West does not allow Ukraine to negotiate with Russia. When talking about economic sanctions against Russia, Lavrov said that despite the EU's restrictions on seaborne oil, Russia will significantly expand oil exports to markets outside the EU. Given the high oil prices, the Russian budget will not suffer losses. Russia's energy exports in 2022 Profits increased significantly. (Global Times)
U.S. jobs added more than expected in May, strong labor market keeps Fed on aggressive path
① The US added non-farm jobs in May more than expected, and wage growth remained at a fairly strong level, indicating a strong job market, which will prompt the US Federal Reserve (FED/Fed) to continue to adopt aggressive monetary tightening policies to cool down need. The data also showed the unemployment rate held steady at 3.6% for the third straight month, despite more people entering the labor force. That paints a picture of continued economic expansion, albeit at a slower pace.
② U.S. President Biden said the May jobs report was “very good” and he expected the pace of hiring to slow further in the coming months.
The U.S. ISM services index fell in May, and business activity growth slowed ①Due to the slowdown in business activities, the U.S. service industry growth slowed to the lowest level in more than a year in May.
②According to data released last Friday, the Institute for Supply Management (ISM) services index fell to 55.9 from 57.1 in April. Although it remains firmly above the 50 watershed of prosperity and decline, it is already the weakest since February 2021.
A measure of business activity fell 4.6 to a two-year low of 54.5 last month. However, another measure of demand, the new orders index, climbed to 57.6 in May.
④ The median forecast in a Bloomberg survey was 56.5. Fourteen service industries posted gains last month, led by mining, construction and real estate.
⑤ Consumers have so far continued to hold on to spending in the face of soaring oil prices, but high inflation (including record gasoline prices) coupled with rising borrowing costs may limit discretionary spending in the coming months.
⑥ The ISM survey showed that the price paid index for the service industry fell to 82.1, and the employment index rose slightly. But even then, it was only slightly over 50.
Fed Mester says may need to raise interest rates by 50 basis points in September as well "Evidence that inflation has peaked, according to a slew of data. Mester and other Fed policymakers, including Chairman Jerome Powell, have signaled that they will continue to raise rates by the same amount at their June and July meetings after raising rates by 50 basis points last month. "If I don't see convincing evidence at the September meeting, I'll probably vote for a 50 basis point hike," Mester said.
Bank of America expects the European Central Bank to raise interest rates by 50 basis points at least twice in 2022 ① Bank of America expects that the European Central Bank will raise interest rates by 50 basis points in July and September, and by 25 basis points in October and December.
② This forecast is far more hawkish than the current consensus of economists, implying that the deposit rate will increase by 150 basis points this year. Economists Ruben Segura-Cayuela and Evelyn Herrmann said in a note that they were more certain about the overall rate hike.
③ "We strongly believe in a 150 basis point rate hike in 2022," they wrote. "But we're less certain about the exact timing of a 50 basis point hike."
④ The two economists also predicted that the ECB's interest rate hikes will stop in 2023. Bank of America had previously forecast four 25 basis point rate hikes this year and two next year.
⑤ They mentioned in their latest report that they are concerned that the ECB is “doing too much/too fast, creating problems in terms of growth or spreads, or both.” Although their forecasts are hawkish, they Indicates "bearish on the macro outlook".
⑥ European Central Bank officials will meet next week and are expected to reveal plans to reduce stimulus measures, immediately end large-scale asset purchases, and raise interest rates for the first time next month.
Survey: The European Central Bank is expected to raise interest rates slightly from July, and the expectation of a 50 basis point increase may fail Efforts to cut interest rates by 50 basis points are likely to fail.
②The survey results show that the ECB is expected to raise the deposit rate (currently -0.5%) by 25 basis points in July and September respectively. While this is in line with ECB President Christine Lagarde's pledge to end negative interest rates in the third quarter, the rate hike will be less than expected by officials such as Austrian Central Bank President Robert Holzmann.
③ Calls for stronger action have grown as the ECB pulls back from stimulus, as euro zone inflation hit another record high of 8.1 percent in May, more than four times the ECB’s target.
④ However, Lagarde is expected to use the June 9 news conference to confirm the more cautious exit strategy she laid out last week, which is to end large-scale quantitative easing before raising interest rates in July.
⑤ "The ECB is expected to pre-commit to raising deposit rates in July, reiterating its intention to end quantitative easing by the end of the second quarter as planned," said Claus Vistesen, chief euro zone economist at Pantheon Macroeconomics. "The question is whether this will be a 25 basis point hike or 50 basis points. We think it's the former, but the pressure to act more decisively is rising."
5 police officers injured in bomb attack in Kenya's Garissa
On June 5, an improvised bomb attack occurred in Garissa County, Kenya, injuring five police officers. On the same day, an improvised bomb device placed on the side of the road suddenly exploded while a convoy led by a police car was driving, causing serious damage to the vehicle. The injured have been sent to the hospital for treatment. Local police said the bomb may have been detonated by Somali al-Shabaab militants. (CCTV News)
The latest poll: Only 37% of Americans approve of Biden's handling of current economic problems The results show that only 37% of people approve of US President Biden's handling of the current economic problems in the United States, only 28% of people approve of his handling of inflation, and 27% of people support Biden's handling of rising gasoline prices. More than 80 percent of Americans say economic concerns, inflation and rising natural gas prices are the most important issues in determining how they vote this November, polls show. And with the midterm elections approaching, public support for Biden's handling of these key issues is low. (CCTV News)
List of major global market conditions
U.S. stocks fell sharply on Friday after better-than-expected jobs data for May suggested the labor market remained strong enough for the Federal Reserve to keep raising interest rates to curb inflation. U.S. stocks returned to a weekly decline as strong jobs data paved the way for aggressive interest rate hikes by the Federal Reserve to fight inflation, with the S&P 500 down 1.6 percent, closing lower in eight of the past nine weeks. Tesla also dragged tech stocks lower on Friday on reports that the company plans to cut salaried workers. Energy stocks rose as crude oil hit $120 a barrel in New York.
The Fed is expected to raise interest rates by 50 basis points each at the next two meetings, and after the release of the jobs report, the market implied probability of a third rate hike in September remained around 85%.
Peter Essele, head of portfolio management at Commonwealth Financial Network, said the second half of 2022 will be a roller coaster for investors unless the Fed can control inflation and not cause a hard landing, and most investors seem to be betting on a hard landing scenario, a recession. Fears pervaded and stocks failed to build any positive momentum.
Investors remained focused on economic data and its impact on the pace of U.S. monetary tightening amid growing concerns that restrictive Fed policy could tip the world's largest economy into recession. The strong jobs report quelled some concerns while also clearing the way for the Fed to remain aggressive.
precious metal
Spot gold fell by more than 1% at one point, hitting a daily low of $1,847.26 an ounce, affected by a stronger dollar and better-than-expected U.S. jobs data sparking concerns about aggressive monetary tightening.
On Friday (June 3), the U.S. dollar rose 0.41%, and the 10-year U.S. Treasury yield was close to a two-week high hit earlier in the session, which put pressure on gold prices; gold prices fell 0.12% last week, although slightly It had touched $1,873.99 an ounce, the highest since May 9.
Data showed that the U.S. added more nonfarm payrolls than expected in May, and wage growth remained at a fairly robust level, indicating a strong labor market.
David Meger, head of metals trading at High Ridge Futures, said the Fed may feel more emboldened to speed up the pace of rate hikes if they think the economy remains stable during its rate hikes.
Cleveland Fed President Mester said on Friday that she is looking for "compelling" evidence that inflation has peaked, and if not, she is likely to support a 50 basis point hike at the September meeting.
crude
U.S. oil rose nearly 3% in late trading last Friday, standing at the $120 mark, a new high since March 9. The market expects the Organization of the Petroleum Exporting Countries (OPEC) to decide to slightly increase the output target from the plan, which will not increase global supply too much. . And global supply should tighten after some regions ease the epidemic.
OPEC and its allies including Russia, OPEC+, agreed to increase output by about 650,000 bpd a month over the next two months, instead of the current 432,000 bpd.
U.S. crude rose for a sixth straight week, helped by tight U.S. supplies, which has sparked discussions of capping fuel exports or imposing windfall taxes on oil and gas producers.
Jim Ritterbusch, president of Ritterbusch and Associates LLC, said the OPEC+ decision and the accelerated release of the Strategic Petroleum Reserve have kept crude supplies at adequate levels, especially as demand from refiners is significantly lower than it was a few years ago.
U.S. President Joe Biden has publicly acknowledged that he may soon travel to Saudi Arabia, which multiple sources said was to be expected, and that Biden could hold talks with leaders including Saudi Crown Prince Mohammed.
Supply remains tight. On Thursday, the weekly U.S. inventories report showed crude inventories plummeted by 5.1 million barrels, a sharper-than-expected drop. Gasoline inventories also fell.
The U.S. oil and gas rig count remained unchanged at 727 for the week ended June 3, according to a closely watched report from Baker Hughes on Friday.
foreign exchange
The U.S. dollar index rose 0.41% to 102.18 on Friday, after gaining about 0.5% last week after a better-than-expected U.S. jobs report that showed a tighter labor market may keep the U.S. Federal Reserve aggressively raising interest rates.
Minh Trang, senior foreign exchange trader at Silicon Valley Bank, said the non-farm payrolls data was quite solid, and the strong employment data supported expectations for further rate hikes in the second half of the year.
The Fed has already raised interest rates by 0.75 percentage points this year, and most Fed policymakers support another 0.5 percentage point hike at each of the next two meetings.
Cleveland Fed President Mester said on Friday she would be looking for "compelling" evidence that inflation has peaked before supporting a slower pace of interest rate hikes. Policymakers said the Fed could raise rates by 50 basis points each in June and July.
Investors were divided on the dollar, which remained near 20-year highs against a basket of currencies. George Saravelos, global head of foreign exchange research at Deutsche Bank, said the dollar is "priced at a very extreme risk-off premium that rarely lasts and investors are unwinding that position right now."
Optimistic analysts believe the Fed's tightening cycle is based on stronger U.S. economic growth than Europe's, especially after an embargo on Russian oil that could hurt the euro zone economy.
The dollar rose as much as 0.87% against the yen to a more than three-week high of 130.97, not far from a 20-year low hit in May, as the Bank of Japan stuck to its ultra-low interest rate policy stance. Bank of Japan Governor Haruhiko Kuroda said on Friday that he was unhappy with prices rising too fast amid weak household income growth. He has said the bank will not withdraw its massive monetary stimulus because the recent rise in inflation, driven mainly by rising raw material costs, may be temporary.
"Everyone, including the ECB, is talking about things like raising rates, but when it comes to the Bank of Japan, we don't see that discussion, and I think that's why you see the yen," said Silicon Valley Bank's Trang. Exaggerated downtrend.
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